Top 5 financial things to do before labour get in?
Discussion
MiniPro3 said:
Could be worse, could be mass corruption, huge money printing to make people poorer and selling your kids into slavery to raise money for the UK with the Conservatives? I see the thread is still doing max fear. You'd think it was McDonnell in the wings.
The wealth tax on the prior page, isn't happening. Fake legitimacy "its come from academics is stating the obvious", but means FA. There will very likely be some form of wealth led tax - probably being via council tax, but they are getting very schooled on what and what can't they do. Pensions and primary residency are very much the last things on the hit list.
VAT on school fee's is a daft idea, but possibly the limit of the "politics of envy" / appease the hardcore left / spiteful s
te they think they can get away with as its not a financial but political calculation.
Its a rubbish idea, won't raise a lot but its an alarm bell that bellies the reality.
They are snookered financially, so the policy moves won't be dramatic but boring and parochial.
What they are going to do is - change the fiscal rules.
They've said they've signed up to them, but they will very quickly change them (and why not the Tories changed them 7 times since 2010).
There are a number of rules and calculations methods (PSND - Public Sector Net Debt and PSNW - Public Sector net Worth) they can adjust and very much get away with - IF the money goes to the right place.
The tax / spend history or narrative ignores the obvious - there is nothing more to give. They have to go for growth. Now some of the numbers they have bounded about are bks. Reeves has said for every £1 of public investment, the multiplier is 2x from private. The reality its 0.5 - but they can muck around with the rules and calculations on debt to GDP (like including BoE bond purchases) - would yield many billions for growth driving investments. Getting 2.5% GDP growth is tough - but if they are disciplined possibly doable.
And some of that higher end growth number is looking dependent on a larger Labour majority. Which is really interesting.
The fear gauge on a centre left Labour party fuelled by historical observation is way of the scale. The size of the existing debt balloon and the antics or learnings from the Trusstert**k / Kamikwase budget - means we've moved paradigm. They cannot do anything really stupid, because the global markets will break them (which in the UK is a big issue for Pensions). Any silly Corbyn / McDonnellesque policy exuberance has been completely nixed.
The wealth tax on the prior page, isn't happening. Fake legitimacy "its come from academics is stating the obvious", but means FA. There will very likely be some form of wealth led tax - probably being via council tax, but they are getting very schooled on what and what can't they do. Pensions and primary residency are very much the last things on the hit list.
VAT on school fee's is a daft idea, but possibly the limit of the "politics of envy" / appease the hardcore left / spiteful s
te they think they can get away with as its not a financial but political calculation.Its a rubbish idea, won't raise a lot but its an alarm bell that bellies the reality.
They are snookered financially, so the policy moves won't be dramatic but boring and parochial.
What they are going to do is - change the fiscal rules.
They've said they've signed up to them, but they will very quickly change them (and why not the Tories changed them 7 times since 2010).
There are a number of rules and calculations methods (PSND - Public Sector Net Debt and PSNW - Public Sector net Worth) they can adjust and very much get away with - IF the money goes to the right place.
The tax / spend history or narrative ignores the obvious - there is nothing more to give. They have to go for growth. Now some of the numbers they have bounded about are b
ks. Reeves has said for every £1 of public investment, the multiplier is 2x from private. The reality its 0.5 - but they can muck around with the rules and calculations on debt to GDP (like including BoE bond purchases) - would yield many billions for growth driving investments. Getting 2.5% GDP growth is tough - but if they are disciplined possibly doable.And some of that higher end growth number is looking dependent on a larger Labour majority. Which is really interesting.
The fear gauge on a centre left Labour party fuelled by historical observation is way of the scale. The size of the existing debt balloon and the antics or learnings from the Trusstert**k / Kamikwase budget - means we've moved paradigm. They cannot do anything really stupid, because the global markets will break them (which in the UK is a big issue for Pensions). Any silly Corbyn / McDonnellesque policy exuberance has been completely nixed.
Legacywr said:
Seems a good place to ask this, should I take my 25% tax free from my pension if I don’t actually need it?
I guess if you don’t need it then the only risk as such is perhaps when / if you do is to then find Labour have played with the rules and you can’t !I have just taken mine to then give to my 3 children as part of their house funds.
macron said:
IHT threshold fixed, LTA reinstated, both presumably staying there to let that fiscal drag fk us all.
So top 5 things to do,
1) if you are old, give stuff away to get or keep your estate below the threshold. Trouble is old.folk worry and tend not to.
Ref point 1,k us all.So top 5 things to do,
1) if you are old, give stuff away to get or keep your estate below the threshold. Trouble is old.folk worry and tend not to.
https://www.telegraph.co.uk/politics/2024/07/02/la...
TLto12ft.io it, Darren the wet blanket Jones wants more IHT to redistribute wealth.
OoopsVoss said:
I see the thread is still doing max fear. You'd think it was McDonnell in the wings.
The tax / spend history or narrative ignores the obvious - there is nothing more to give. They have to go for growth. Now some of the numbers they have bounded about are bks. Reeves has said for every £1 of public investment, the multiplier is 2x from private. The reality its 0.5 - but they can muck around with the rules and calculations on debt to GDP (like including BoE bond purchases) - would yield many billions for growth driving investments. Getting 2.5% GDP growth is tough - but if they are disciplined possibly doable.
The fear gauge on a centre left Labour party fuelled by historical observation is way off the scale.
We shall see. Meanwhile many prudent people are taking steps to defend themselves because there will only be regrets if and when yet another UK government reneges on its election promises or weasles its way around the words. There's an article Article on this very subject in tomorrow's FT,The tax / spend history or narrative ignores the obvious - there is nothing more to give. They have to go for growth. Now some of the numbers they have bounded about are b
ks. Reeves has said for every £1 of public investment, the multiplier is 2x from private. The reality its 0.5 - but they can muck around with the rules and calculations on debt to GDP (like including BoE bond purchases) - would yield many billions for growth driving investments. Getting 2.5% GDP growth is tough - but if they are disciplined possibly doable.The fear gauge on a centre left Labour party fuelled by historical observation is way off the scale.
https://www.ft.com/content/34d72fa2-d3b8-439a-886f...
For those in a fortunate financial position it makes a lot of sense to consider,
- Giving away assets completely tax free so long as they survive 7 years, and
- Pocketing some Capital Gains at only (10% or) 20% tax
Panamax said:
We shall see. Meanwhile many prudent people are taking steps to defend themselves because there will only be regrets if and when yet another UK government reneges on its election promises or weasles its way around the words. There's an article Article on this very subject in tomorrow's FT,
https://www.ft.com/content/34d72fa2-d3b8-439a-886f...
For those in a fortunate financial position it makes a lot of sense to consider,
Well you should be doing 1 anyway (although macron points out some people don't like doing this).https://www.ft.com/content/34d72fa2-d3b8-439a-886f...
For those in a fortunate financial position it makes a lot of sense to consider,
- Giving away assets completely tax free so long as they survive 7 years, and
- Pocketing some Capital Gains at only (10% or) 20% tax
2 is dependent on many factors (like liquidity).
I'm. Life long Tory voter, but thinking that Labour will be any worse than the current shower who have adjusted fiscal rules, presided over disastrous fiscal policy is an act of faith / dogma.
The current leadership (Labour) is getting a lot of institutional financial advice on what they can and can't do (let alone observed markets power to break them).
There is always a risk they go stupid, buts increasingly unlikely given what they have to play with and do.
They need growth and that means private sector support. They can free up 20-40bn per annum by playing with accounting rules and looking at the BoE QE losses. No amount of envy driven wealth grab gets close to that short term.
I'd be a lot more concerned about other policy stupidity than making rash financial decisions right now. Lowering the voting age is a huge red flag, if they start pushing that nonsense then panic - but going nuts on tax etc day 1 is a risk (IMHO) they can't take.
ooid said:
Well, a large number of them voted Corbyn just about 5 years ago!
There's been a global pandemic and we've gone from 80% to 100% Debt to GDP since. Any policy exuberance they think they had has evaporated. One assumes you were about for Kwasi and Truss? And if anyone thinks that the Conservatives have more economic nouse given how badly Truss / Kwasi misread the Gilts / pensions market - I'm somewhat bemused. Aside from accounting trickery (which is guaranteed), to free up a chunk for investment (Green invest looks to have a decent fiscal / growth multiplier effect); their only option is to seek max growth. You can't do that if you alienate huge swathes of your growth engine. Most banking macro predictions have economic growth being higher - IF Labour get a decent and sizable working majority. Why is bank - in particular Investment bank thinking so divergent from here?
Corbyn / McDonnell economic reality only exists in the minds of the 6th Form socialist debating society. VAT on school fees is egregious - "if" they push ahead with it (to appease the remnants of the 6th form) - but the blowback and alienation of needed support base won't be worth it. Everything carries risk, but your wouldn't wear a crash helmet to cross the road - but the overall economic prognosis for UK plc is weaker with another Tory government.
bhstewie said:
hstewie said: Pound slightly stronger.
FTSE100 up.
Life goes on.
This was never a surprise.FTSE100 up.
Life goes on.
Fiscal expansion - good for FTSE250
Labour promises on housing - good for house building stocks (up 2% on the day)
Sizable majority and stable government - UK plc looks like a safe haven (the EU and France in particular look increasingly subject to turmoil with a big discussion on how much Monetary firepower should be deployed Vs. fiscal restraint)
Goldman says UK economy to grow faster under Labour....
OoopsVoss said:
Lowering the voting age is a huge red flag
I can only think that idea is because most teenagers are likely to vote Labour. No doubt it will be sold as 'it's important to allow young people to engage in politics'. No it isn't. Let them grow up and be a bit older and wiser first.Simpo Two said:
OoopsVoss said:
Lowering the voting age is a huge red flag
I can only think that idea is because most teenagers are likely to vote Labour. No doubt it will be sold as 'it's important to allow young people to engage in politics'. No it isn't. Let them grow up and be a bit older and wiser first.OoopsVoss said:
This was never a surprise.
Fiscal expansion - good for FTSE250
Labour promises on housing - good for house building stocks (up 2% on the day)
Sizable majority and stable government - UK plc looks like a safe haven (the EU and France in particular look increasingly subject to turmoil with a big discussion on how much Monetary firepower should be deployed Vs. fiscal restraint)
Goldman says UK economy to grow faster under Labour....
Bit surprised with this, it was such an obvious result I'd have thought it would all be priced in already ages ago. Fiscal expansion - good for FTSE250
Labour promises on housing - good for house building stocks (up 2% on the day)
Sizable majority and stable government - UK plc looks like a safe haven (the EU and France in particular look increasingly subject to turmoil with a big discussion on how much Monetary firepower should be deployed Vs. fiscal restraint)
Goldman says UK economy to grow faster under Labour....
NRS said:
Can we please have a maximum voting age then? People's brains deteriorate when they are older so they lose a lot of their wisdom. We also get stubborn and learn a lot less in our old age and have views based on when we typically grew up, not the world around us (dislike new things). Not to mention it will affect older people for a much shorter time too. Maybe set a maximum age of 65 or so?
You might not approve of that idea when you reach 65... but some sort of mental acuity test could be taken. After all you wouldn't want someone like Joe Biden to be allowed to vote would you!And so we now have a Labour PM who went to private school and is a knight of the realm. Will he make me richer or poorer, lower taxation or reduce immigration? I'm not feeling lucky.
isleofthorns said:
so, now we are where we are....did anyone actually do anything proactive in advance of the inevitable?
1. Maxed out ISA2. Gave cash to the kids
3. Gave notice to my Tenants of large rent rises (I believe rent caps are inevitable)
2. and 3. were started way before it was an inevitable win though
NRS said:
Bit surprised with this, it was such an obvious result I'd have thought it would all be priced in already ages ago.
It was, almost nothing happened in markets today. The FTSE250 / housebuilding bump more a function of how those markets function. Gilt issuance path is priced in - discussion is really when the BoE cuts.The Financial Markets see strong and stable UK government as good for UK plc. Especially as its viewed relative to others. Europe and in particular France is going the other way - and getting into a dust-up with your Central bank (regardless Right or Left emerges victorious there IS not good). That is probably helping Labour a lot right now.
Sizable majority and predictable behaviour is what markets like - they got what they wanted. They (Labour) have a small grace period to solidify the growth plan - but the expectation is they have learned from the Trussterf**k and can't possibly be that stupid. Reeves has some economic background (stint at BoE) and in her Mais Lecture - does suggest she knows all the dangers ahead (which puts her head and shoulders above the 2022 clown act). Although she has mentioned national wealth accounting (not likely to be welcomed), she does talk a lot and understand the magnitude of the hole they are in and how important state / private sector investment is critical to growth generation.
She doesn't look anywhere near as threatening as anything since Blair....
Edited by OoopsVoss on Friday 5th July 13:54
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